Russia and Ukraine presidentsTensions remain heightened for the Ukraine, as pro-Russian protesters stormed government headquarters in Donetsk on Wednesday, once again raising a Russian flag. Clashes continue in the streets, with several dead and many more injured or arrested, the United Nations (UN) envoy to Ukraine also had to abruptly cancel his mission in Crimea, after he was chased off by pro-Russian protesters.

Aside from the social demonstrations and clashes in the streets, Ukraine is facing economic worries and possible bankruptcy. The European Union has pledged to provide 11 billion euros ($15 billion) of financial assistance to Ukraine which will be carried out over the next couple of years, thanks to help from the European Bank for Reconstruction and Development, and the European Investment Bank. To partake in this offer, Ukraine will also be required to sign a deal with the International Monetary Fund.

Ukraine has also accepted offers of talks with Moscow, pledging to seek a peaceful solution to the ongoing crises. The decision was reached after Foreign Secretary of the United Kingdom, William Hague, the Acting Foreign Minister of Ukraine, Andriy Deshchytsia, and the U.S. Secretary of State John Kerry met in Paris to discuss a resolution. Deshchytsia insists that Ukraine will continue to seek a peaceful solution to the conflict, a notion which was reiterated by the Russian Foreign Minister Lavrov. The U.S. will also be increasing military presence in Poland amid the ongoing tension in the region.

russiahhThe high chamber of the Russian parliament is also scrambling to prepare a draft law in case of EU and US sanctions, unlike other US victims; Russia is prepared to retaliate against the economic warfare. The proposal will aim to freeze US and EU assets, Russian President Vladimir Putin said on Wednesday that the ongoing crisis might have a negative effect on the Customs Union which links three nations: Russia, Belarus, and Kazakhstan. Putin has called for protection for the three nations’ producers and exporters.

“….forging a coordinated response without harming vital economic interests of EU states who are also, to a large extent, dependent on Russian gas supplies … is a complicated and time-consuming effort,” – Alex Melikishvili, senior Europe/CIS Analyst at IHS Country Risk

Russia is Germany’s top supplier of natural gas, much of it travels to Europe via pipelines that also run through Ukraine. The EU is one of Russia’s top trading partners at hundreds of billions annually, with China coming in second, followed by Ukraine and Belarus. One of Putin’s advisors has suggested that he sell Russia’s U.S. bonds, which are worth 200 billion: fuel for a devastating blow to American financial system. The sale of the bonds may actually be part of a larger strategic decision: a further step towards changing the world reserve currency.